Spotlight on ten London Investment Opportunity Areas

The rapid expansion of the private rental sector in London is creating significant opportunities for investors. Chestertons researchers have selected the ten investment areas we are expecting to see some of the highest house price growth in London, which will all benefit from new infrastructure and regeneration. If London is going to reach its required one million new homes by 2020 then these regeneration areas will be ripe for further residential development creating an increase in desirability and uplift in demand. Majority of our hot spots are in outer London boroughs, where average prices are lower and where we anticipate the greatest house price growth over the medium to long term.

Croydon

Croydon is due to benefit from major regeneration which will amount to £5.25bn and is predicted to generate 7,500 new jobs and create capacity for an extra 7,300 new homes. Additionally, over the next few years Croydon's two main shopping centres Whitgift and Centrale are set to receive £1bn for redevelopment under a major Westfield-led scheme, which will reposition Croydon as one of the premier shopping destinations in South London, creating retail, commercial and public space and thousands of jobs. Furthermore, after East Croydon Station upgrades, journey times to central London will be cut to just 15 minutes.

Two-bedroom apartment Croydon

Average asking price £380,982

Average asking rent £1,290 pcm

Historic five-year house price growth 47.31%

Projected five-year house price growth 31%

Old Oak Common park

As a longer-term investment, Old Oak Common is well worth considering. It has been recognised with the potential to build 24,000 homes over the next 30 years, plus the area benefits from plenty of green space. The plan also includes commercial and office space, which will reportedly provide 55,000 jobs, as well as space for 1,500 businesses. Furthermore, there will be a new super hub station combining both HS2 and Crossrail 1 lines, which will be capable of handling around 250,000 passengers a day.

Two-bedroom apartment Old Oak Common

Average asking price £525,970

Average asking rent £1,495 pcm

Historic five-year house price growth 64.04%

Projected five-year house price growth 30%

Tottenham Court Road

The Tottenham Court Road lies within a busy shopping area in the London Boroughs of Camden and Westminster. It is centred on Tottenham Court Road underground station and includes parts of world famous streets including Oxford Street, Regent Street, Tottenham Court Road and Charing Cross Road. The area has been ear marked for the development of 500 homes and the creation of 5,000 additional jobs, powered by extensive upgrades to the underground station and the arrival of Crossrail from 2018. New corporate occupiers have already moved in, and good returns from prudent residential investments are sure to follow.

Two-bedroom apartment Tottenham Court Rd

Average asking price £1,775,366

Average asking rent £4,340 pcm

Historic five-year house price growth 55.43%

Projected five-year house price growth 33%

The Isle of Dogs

In the past 30 years the derelict wastelands of the Isle of Dogs have been regenerated into prime London property, boasting some of London's most sought-after commercial and residential properties. This trend is forecast to continue with a number of forthcoming developments including a Crossrail 1 station, which should help to support an additional 110,000 jobs and 10,000 new homes by 2031. Furthermore, Boris Johnson, the Mayor of London, has launched a vision for a significant increase in the number of river crossings, with eight of the proposed 13 links in the Docklands and two in the Isle of Dogs. Canary Wharf and Docklands are powering London's jobs boom at the moment, and as such have also become very attractive to residential investors looking to cash in on increased tenant demand from employees of some of the world's biggest companies.

Two-bedroom apartment Isle of Dogs

Average asking price £751,072

Average asking rent £2,454 pcm

Historic five-year house price growth 52.15%

Projected five-year house price growth 32%

Greenwich Peninsula

The regeneration of Greenwich Peninsula is already well underway and looks set to be expanded into London's largest regeneration scheme, after an £8.4bn extension of the peninsula was approved. The project will create 15,270 new homes and see 28,000 people living there by 2025. The area will be twice the size of Soho and will have a public river frontage extending over a mile and a half. There will be two schools, independent shops, bars and restaurants, 48 acres of public squares and parkland. Also, Boris Johnston has recently given permission for a new cruise liner terminal at Enderby Wharf, which should bring 55 liners and thousands of tourists to the area each year.

Two-bedroom apartment Greenwich

Average asking price £535,616

Average asking rent £1,855 pcm

Historic five-year house price growth 48.51%

Projected five-year house price growth 38%

City Fringe/Tech City

London is the digital capital of Europe and the growing digital-creative cluster at Tech City is set to increase its employment capacity by 70,000 and also build 8,700 homes. There are planned public transport improvements to London Overground stations and new Crossrail 1 stations at Liverpool Street and Whitechapel. The Tech boom is driving regeneration across the city, and is now leaping ahead of the city fringe, moving into areas such as Shoreditch and Peckham as it is relatively footloose as an industry. Predicting exactly where the next tech hub will be isn't an exact science, but the returns can be strong and sustained for investors who buy into the right place at the right time.

Two-bedroom apartment City Fringe

Average asking price £710,7856

Average asking rent £2,882 pcm

Historic five-year house price growth 62.16%

Projected five-year house price growth 37%

Royal Docks & Beckton Waterfront

The Royal Docks and Beckton Waterfront has been ear-marked as a site where 11,000 new homes will be built, 6,000 new jobs created and where London's first Asian business park will be created, offering a gateway from the Far East into the East End. The plan is to return the area to its former glory at the forefront of international trade and exchange, aided by future expansion of London City airport, and driven in large part by massive Chinese investment. Crossrail's Custom House station will lie to the north of the Royal Victoria Dock, which is conveniently only one stop from Canary Wharf. In addition to other infrastructure projects proposed are the Silvertown Tunnel (connecting the Royal Dock with Greenwich) and Gallions Reach footbridge, which will connect the Royal Docks with Woolwich.

Two-bedroom apartment Beckton

Average asking price £254,817

Average asking rent £1,420 pcm

Historic five-year house price growth 43.85%

Projected five-year house price growth 36%

Waterloo and the Southbank

The regeneration at Waterloo will benefit from £400m of improvements to the station, as well as the creation of at least 2,500 homes and 15,000 jobs over the next 30 years. South West Trains has seen passenger numbers double in the past 20 years, making Waterloo the country's busiest station, with 98m people using it every year. Expect new waterside developments and a good deal of refurbishment of period properties, while Oval, Kennington and Vauxhall are likely to follow in Waterloo's footsteps as the new powerhouses of regeneration and value growth on this oft overlooked side of the Thames.

Two-bedroom apartment Waterloo

Average asking price £1,389,024

Average asking rent £2,536 pcm

Historic five-year house price growth 72.04%

Projected five-year house price growth 35%

Cricklewood/Brent Cross

Cricklewood and Brent Cross is subject to plans that will see 10,000 new homes as well as new buildings for three local schools, new health facilities, and high quality parks and open spaces created. More than £400m will be invested just in the transport infrastructure including new roads, increased capacity at key junctions and the creation of a new station on the Midland Mainline and Thameslink lines.

Two-bedroom apartment Brent Cross

Average asking price £445,642

Average asking rent £1,713 pcm

Historic five-year house price growth 48.34%

Projected five-year house price growth 33%

Brentford

Brentford will benefit from a regeneration project which will provide a mixture of shops, cafés, restaurants and office and community space, as well as significant new residential development. The largest single project is Ballymore's Brentford Waterside development which will cover a 4.79ha site between the High Street and the River Brent and include up to 876 new homes, 797 of which will be private. Furthermore, there are plans to regenerate the waterside area of Waterman's Gardens along with additional improvements to the surrounding foreshore and park. Brentford also benefits from good access to Heathrow airport which is only 25 minutes by road while central London is only around 30 minutes away by train.